The steam turbine market comprises of large steam turbines that are used in power generation facilities to produce electric power from steam. Steam turbines convert thermal energy from pressurized steam into rotary motion to power an electrical generator. They provide reliable, flexible, and efficient power generation.
Market Opportunity:
The growing demand for renewable energy generation across the globe presents a major opportunity for the steam turbine market. There is a significant increase in investments towards wind and solar energy projects worldwide in order to reduce dependence on fossil fuels. Steam turbines play a vital role in concentrating solar power plants by generating power from steam heated by solar thermal energy. They are also used in integrated gasification combined cycle power plants to produce electricity from renewable biomass or waste resources. The increasing focus on renewable and clean energy solutions to meet electricity needs in an environment friendly manner will drive the adoption of steam turbines, thus augmenting the market growth over the forecast period.
Porter's Analysis
Threat of new entrants: Low economies of scale in manufacturing and high costs of acquiring distribution channels and brand recognition make entry difficult.
Bargaining power of buyers: Large utilities and industrial customers have strong bargaining power due to the significant portion turbine projects represent of total capital expenditure.
Bargaining power of suppliers: Turbine OEMs, turbine component suppliers and engineering firms face low bargaining power due to the consolidated nature of supply.
Threat of new substitutes: Technologies such as renewable energy and energy storage threaten the demand for steam turbines in base load power generation to some extent.
Competitive rivalry: Intense competition exists among global turbine OEMs due to their focus on expanding footprint to high growth regions.
SWOT Analysis
Strength: Proven operational efficiency and ability to partially substitute fossil fuel plants. Large incumbent base of installed fleet ensures steady services revenues.
Weakness: Highly cyclical with volatility in capital expenditure. Dependence on fossil fuels makes the sector vulnerable to carbon transition policies.
Opportunity: Rising power demand in developing nations drives the need for replacement of aging fleet as well as capacity additions. Growth in industrial combined heat and power generation.
Threats: Global push for cleaner energy threatens fossil fuel based power. Rapid decline in renewable energy costs poses challenges.
Key Takeaways
The Global Steam Turbine Market Growth is expected to witness high supported by capacity additions in Asia Pacific and replacement demand from mature markets.
Regional analysis for Asia Pacific region comprises over 50% share of the global steam turbine market led by China and India. China dominates power generation from coal and several planned projects are expected to drive demand. India is another major market expanding nuclear and thermal installed capacity to meet rising energy needs of a growing economy.
Key players operating in the steam turbine market are General Electric, Siemens, Mitsubishi Hitachi Power Systems, Dongfang Electric, Toshiba, Elliott Group, Ansaldo Energia, Doosan Škoda Power, Man Diesel & Turbo, and Kawasaki Heavy Industries.
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